State-owned oil/gas firm Saudi Aramco has signed a Memorandum of Understanding (MoU) with China’s Zhejiang Free Trade Zone, in which the Zhoushan Government emphasised its support for incentivising Saudi Aramco’s greater investment in Zhejiang’s future downstream growth. The MoU was signed in conjunction with a visit to Saudi Aramco’s headquarters in Dhahran by Yuan Jiajun, Governor of the Chinese province of Zhejiang.
Together with prior agreements signed during Prince Mohammed Bin Salman’s visit to China in February this year, this MoU facilitates Saudi Aramco’s planned acquisition of a 9% stake in the Zhejiang integrated refinery and petrochemical complex. It will also include a long-term crude oil supply agreement and the ability to utilize Zhejiang Petrochemical’s large crude oil storage facility to serve its customers in Asia. These activities reflect the Company’s strategy to expand its presence in the Chinese energy sector.
The agreement solidifies Saudi Aramco’s participation in the 400,000 barrels per day refinery from Phase III of the Zhoushan Petrochemical Greenfield project, and also allows the parties to evaluate potential opportunities for investment in other parts of the value chain. These may include refining and petrochemical production, storage and trade of crude oil and natural gas, retail, as well as distribution of oil products within the Zhejiang Free Trade Zone.